Petronet plans mini-terminal in Andaman & Nicobar

State-owned Petronet LNG is planning to set up a mini-liquefied natural gas (LNG) terminal in the Andaman and Nicobar Islands at an investment of about Rs 600 crore. The company is also set to commission its second terminal in Kochi in July.

The mini-LNG terminal would be Petronet LNG's first venture outside mainland India. "We are still in the initial stages of talks with the Andaman and Nicobar administration. Also, the feasibility study is yet to take place. Initially, the capacity is expected to be slightly more than 0.5 million tonnes (mt) and this would primarily take care of domestic use within the islands. The mini-terminal would be connected to our upcoming terminals in Kochi and Gangavaram; the gas would be transported using small barges," said Rajender Singh, director (technical), Petronet LNG.

A K Balyan, the company's managing director and chief executive, said the company would commission the Kochi terminal by mid-July. "We would operate the Kochi terminal only at 12 per cent capacity in 2013-14. This is mainly due to pipeline constraints," he said.

GAIL has planned two major pipeline projects to connect Bangalore and Mangalore to the Kochi terminal. The 310-km Kochi-Bangalore pipeline was facing rough weather, owing to land acquisition issues in Tamil Nadu. "For optimal capacity utilisation of the Kochi terminal, we need pipelines in place. Currently, only phase-I of the pipeline project is over. GAIL has come up with a proposal to connect one of the pipelines to Chennai," Balyan said.

This financial year, the company would process at least four to five LNG cargoes from Kochi. Investment for the Kochi project would stand at about Rs 4,500 crore.

Petronet is also in the process of expanding the capacity at its Dahej terminal from 10 mt to 15 mt. The company also said it was in the race to buy a 25 per cent stake in Gujarat State Petroleum Corporation (GSPC)'s five-mt LNG terminal at Mundra. If it acquires stake in the project, it would partner GSPC and the Adani group.